I need your help...A client who is self employed claimed HB/CTB in october 2006 and I requested backdating to April 2006 as he suffers with OCD and was unable toclaim sooner. The backdating was agreed in December 2006 and payment was made direct into his bank account. The day after payment his claim was suspended. I was told by Islington benefits Service that in principal his backdating had been agreed but following a quality check further information was required - bank statements and proof of any self employed earnings. This was submitted within time on 11th Jan 07. Today when I rang to chase up the case I was informed that he had now been overpaid £1300 from May to October 2006 and they used "income" from his bank statement deposits to do this. This income was payments made by the client's mother to pay his rent and living expenses (he is mentally ill) as he was not well enough to claim benefits.

Is there any possible way that HB can ignore this income - most of it was used to pay his rent.

Secondly can they recover when it was their error and they had not asked for this proof when he made his claim?

Many thanks!

Yes, the income should be disreguarded, HB Regs 2006, Shedule 5 para 14

SCHEDULE 5 Regulation 40
Sums to be disregarded in the calculation of income other than earnings

14.—
(1) Subject to sub-paragraph (2), any of the following payments—
(a) a charitable payment;
(b) a voluntary payment;
(c) a payment (not falling within sub-paragraph (a) or (b) above) from a trust whose funds are derived from a payment made in consequence of any personal injury to the claimant;
(d) a payment under an annuity purchased—
(i) pursuant to any agreement or court order to make payments to the claimant; or
(ii) from funds derived from a payment made, in consequence of any personal injury to the claimant; or
(e) a payment (not falling within sub-paragraphs (a) to (d)) received by virtue of any agreement or court order to make payments to the claimant in consequence of any personal injury to the claimant.
(2) Sub-paragraph (1) shall not apply to a payment which is made or due to be made by—
(a) a former partner of the claimant, or a former partner of any member of the claimant´s family; or
(b) the parent of a child or young person where that child or young person is a member of the claimant´s family.

You are a star!

Thank you very much.
Jo

Hi again, just one thing though - how is the income ignored when it is given to the son by his mother when the son is the claimant? It doesn't quite fit in with 2(a) or (b)?

Argue that the money is impressed with a resulting trust and is therefore not part of the cliamants income (see para 6 and 8 of CFC/21/1989

6. In his. helpful submission to me Mr D’Souza made an open 1 submission -on the basis of the decision of Barclays Bank ~
v. Quistclose Investments <1970> A.C. 567. His submission was that it could be argued on the claimant’s behalf that from the moment the money is handed to her every month by her father it is impressed with the resulting trust that she should use it for !the purpose of paying-to the building society the amount due as part of her obligation to the building society and for no other purpose. The money is impressed with the resulting trust and the fact that she does carry out the lender’s intention has no effect on the resulting trust which continues up to the moment of payment to the building society. On that submission the appeal tribunal’s decision was correct though they arrived at it for the wrong reasons. Mr D’Souza addressed me on the written submission of 17 October 1989.
........
8. In my judgment the decision of the appeal tribunal is erroneous in point of law in that although they arrived at the
correct decision they arrived at that decision for the wrong reasons. In accordance with the decision of Barclay’s Bank v.
Quistclose Investments <1970> A.C. 567 on the facts before them it is clear that from the moment the money was handed to the claimant each month by her father it was impressed with the resulting trust that she should use it for the purposes of
payment to the building society as part of her obligation to the building society and for no other purpose. Since that loan is impressed with the resulting trust then the fact that she does carry out the lender’s intention has no effect on the resulting trust which continued up to the moment of payment to the building society. I find it unnecessary to pursue further the agency argument put forward by Mr Bogan at the oral hearing or the arguments based on the decisions referred to at paragraphs 7 to 12 inclusive of the submission dated 17 October 1989 of the adjudication officer now concerned in these appeals. The presumption of advancement and resulting trust are complex matters and the appeal tribunal considered the issues before them in detail and with care. “ I think that Mr D’Souza’s open submission (adopted by the claimant’s representative) based on the loan being impressed with the resulting trust and deriving authority from Quistclose case is the correct solution